Canadian Manufacturing

Desperate Manitoba town offering huge tax breaks to keep Tolko paper mill running

The company announced last month they would close up shop on Dec. 2 and lay off 300 workers because the mill is no longer financially sustainable



PHOTO: Tolko

The Tolko paper mill in The Pas, Man. PHOTO: Tolko

THE PAS, Man.—Town officials in The Pas in northern Manitoba are offering Tolko Industries a massive tax break in hopes it will delay the closure of its paper mill.

The company announced last month they would close up shop on Dec. 2 and lay off 300 workers because the mill is no longer financially sustainable.

Mayor Jim Scott says Tolko leaving would cripple the town’s economy.

But he says he’s found a temporary solution by offering them a tax break of $840,000 a year for three years.

He says the company would not have to pay property tax, business tax or education tax.

Scott says it is not a last-ditch effort.

“I just see it as checking out every possible opportunity,” he says. “We have a very narrow window here. I know it closes on Dec. 2, but we really need to have someone in place in the next two to three weeks as a viable purchaser.”

He adds the impact of Tolko leaving is far greater than the town losing out on millions in taxes.

“They provide an annual payroll of $37 million. So (the tax exemption) hurts, hurts, hurts, but that’s a pain that you can live with. It’s a lot easier to live with that than losing out on $37 million.”

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